Every HECM follows the same FHA rulebook, so the product is nearly identical from lender to lender. What differs is pricing, competence, and how they treat you after closing. These ten questions surface all three.
1. What is your margin?
The margin is added to the index to form your rate, and it directly changes your principal limit through the expected rate. Get it in writing. A quarter point matters.
2. What is your origination fee?
HUD caps it, but lenders price below the cap competitively. Ask for the dollar amount, not a percentage.
3. What are my total closing costs and my net proceeds?
Net proceeds is the only number that lets you compare two offers directly. See the full cost breakdown.
4. When is my rate locked, and for how long?
Expected rate locks can be set at application or closing. In a rising-rate environment, an early lock protects your principal limit.
5. Do you service the loan or sell it?
Most HECMs are sold to a servicer. Ask who will handle your draws, annual occupancy certification, and tax and insurance monitoring.
6. Am I likely to need a LESA?
A competent lender can tell you early whether the financial assessment will require a Life Expectancy Set Aside. Finding out at underwriting is a bad surprise.
7. Do you offer proprietary jumbo options?
If your California home is above the FHA lending limit, a lender without a jumbo program can only show you half the picture.
8. What is your typical closing timeline?
30–60 days is normal for a California HECM including counseling and FHA appraisal. Anyone promising two weeks is skipping something.
9. Are you licensed in California, and what is your NMLS number?
Verify it on NMLS Consumer Access. Ours is NMLS #855360.
10. Will you walk my family through this?
The best outcomes happen when adult children understand the loan before closing, not after. A lender who resists that conversation is a red flag.
Red flags worth walking away from
- Pressure to close before you complete counseling
- Bundling the loan with an annuity or investment product
- Refusal to put the margin in writing
- Vague answers about who services the loan
Compare our numbers yourself in the calculator, or start an application and ask us all ten.
